For example, suppose a futures contract has an expiration date of Thursday, September 22, 2011. The contract's last trading day would be Wednesday, September 21, 2011.

Why it Matters:

Investors typically use options and futures as hedging tools rather than as a way to accumulate the actual underlying assets. As a result, an option or future contract's last trading day represents an investor's final opportunity to sell the contract in the market and relinquish any obligation in connection with its terms.

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